Can You Legally Airbnb Your Duplex or ADU in San Diego?

A 2025 Compliance Guide for Multi-Unit Investors and ADU Owners

One of the most common questions I get asked is regarding the legality of renting out ADUs. This is a complicated and often misunderstood topic, so we wanted to give an overview of our understanding to help you navigate the complex regulations around renting out ADUs on a short term basis.

This 2025 guide explains what’s allowed, what’s off-limits, and how to ensure you’re compliant with San Diego Vacation Rental rules and regulations. And of course, please note that we are not lawyers and this is NOT legal advice in any way shape or form. If you do intend on short term renting your ADU and would like a concrete opinion as to whether or not it is legal, we urge you to contact an attorney or the City of San Diego’s STRO office.

Understanding the 2025 Short-Term Rental Rules in San Diego

San Diego’s STRO ordinance divides short-term rentals into four license tiers:

Tier Use Type Description
Tier 1 Part-Time Primary Residence STR for up to 20 days/year
Tier 2 Home-Sharing STR while host is present (e.g., renting a room)
Tier 3 Whole-Home, Primary Residence STR for 21+ days/year with host not present
Tier 4 Whole-Home, Non–Primary Residence Whole home, year around, short term rental with host not present, in Mission Beach

 

Only one license per natural person is allowed citywide.

Can You Short-Term Rent Both Units of a Duplex?

San Diego only allows one STRO license per natural person. So if you own a duplex:

  • You can short-term rent only one side.
  • You may enter into an agreement with someone giving them the legal right to occupy the dwelling unit and to allow short-term residential occupancy.  This is often done with a spouse or family member. 
  • If you intend to procure a Tier 2 license then the other unit must remain host-occupied

Legal Strategy:

To operate both units as STRs, each would need to:

  • Have a separate “host”, which the city defines a host as a natural person who has the legal right to occupy the dwelling unit and to allow short-term residential occupancy
  • Licensed separately, with a separate STRO License for each unit.
  • Maintain separate Transient Occupancy Tax Certificates

Can You Short-Term Rent an ADU in San Diego?

Generally, no, but there’s one narrow exception.

General Rule: ADUs Cannot Be Used as STRs

Since 2017, San Diego has prohibited short-term rentals of any ADU on the same parcel as another residence, regardless of whether it’s attached or detached.

This includes:

  • Detached ADUs in the backyard
  • Garage conversions
  • Junior ADUs (JADUs)

Why? Because California’s post-2017 ADU laws promote affordable, long-term housing and deter vacation rentals.

Exception: Pre-2017 ADUs

You may be able to legally use your ADU as a short-term rental if all of the following are true:

  • It was permitted and finalized before February 1, 2017
  • It was not built under California’s streamlined ADU laws
  • It is not subject to affordability covenants

If all these conditions are met, the ADU could potentially qualify for a Tier 3 or Tier 4 license, depending on use.

Important: Most ADUs built since 2017 do not qualify under this exception.

How to Segment Short-Term and Long-Term Uses Legally

To stay compliant while maximizing ROI, here’s a sample portfolio structure:

Unit Type Use Type STRO Status
Main Unit (Duplex A) Short-Term (Tier 3/4) Allowed (if licensed)
Second Unit (Duplex B or ADU) Long-Term (≥30 days) No STR license needed
ADU (Pre-2017) Short-Term (maybe) If grandfathered
ADU (Post-2017) Short-Term Not allowed
JADU (any year) Short-Term Not allowed

What Happens If You Break the Rules?

Violating San Diego’s STRO ordinance can result in:

  • Fines up to $1,000 per day
  • Loss of current and future licenses
  • Listing removal from Airbnb/VRBO
  • Refund obligations to guests
  • Lower resale value for non-compliant properties

If your goal is long-term income and portfolio growth, operating illegally is not worth the risk.

Why Compliance Matters for ROI

While short-term rentals can significantly outperform long-term leases in gross income, non-compliance can quickly erode profit through legal costs, vacancy, or forced shutdowns.

Legal compliance protects your:

  • Cash flow
  • License eligibility
  • Exit strategy (resale value)
  • Ability to scale your portfolio

Key Takeaways

  • You can only STR one unit per person/entity in San Diego—whether it’s a duplex, condo, or house.
  • ADUs built after Feb 1, 2017 cannot be used as STRs.
  • ADUs built before Feb 2017 may qualify for STR, but only under strict conditions.
  • Segmenting short-term and long-term rentals within your portfolio is the safest strategy.
  • Compliance = long-term ROI.

Need Expert Help?

Farawae Vacation Rentals offers free compliance reviews and portfolio planning for multi-unit investors. We’ll help you:

  • Verify zoning and license eligibility
  • Structure your property mix legally
  • Maximize both nightly rates and long-term value
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